Bill aimed at reducing the price of gasoline and electricity will have a direct impact of around R$ 19,2 billion on resources allocated to education

Bill (PL) that is being discussed in the National Congress plans to reduce ICMS on Gasoline and Electricity, however, this action could generate negative impacts in the order of R$ 19,2 billion in education.

According to data calculated by the movement All for Education, the Bill (PL) that plans reduce the price of electricity and gasoline which is being discussed in the National Congress could generate impacts of almost R$ 20 billion in resources dedicated to education. This may happen due to the measure that provides for a reduction in the Tax on Circulation of Goods and Services (ICMS), which is levied on products of this type. It is important to highlight that the state tax is one of the main financiers of the Basic Education Maintenance and Development Fund (Fundeb). 

Get a better understanding of the Electricity and Gasoline Reduction Bill

The amount impacted on education is based on an estimate by the National Committee of Secretaries of Finance, Revenue, Finance or Taxation of the States and the Federal District (Comsefaz), which, in its calculations, states that the collection can be reduced by up to R$ 83,5 billion annually in municipalities and states, due to the bill to reduce electricity and gasoline.

The two entities of the federation are responsible for approximately 80% of enrollments between the early years of Early Childhood Education and the end of High School. The PL of ICMS reduction it is considered strategic for the Federal Government, which seeks to regain its popularity in an election year and fights to lower the price of products that are directly impacted, consequently reducing inflation.

The effectiveness of this “method”, however, is questioned, especially in relation to gasoline, which has a price policy that follows the international market. The measure, which may have an impact on education, has already passed through the House and is about to be discussed in the Senate. 

PL can generate a reduction in the complementary resources of the Union

By determination of the Constitution, at least 25% of the tax collection must be redirected to the development and maintenance of education, therefore, the drop generated by the PL to reduce gasoline and electricity it must be of the same order in municipalities and states that do not complement the amount.

The impact of Fundeb should be 20%, considering that the Magna Carta establishes this mandatory percentage of tax transfer to the fund. It is important to emphasize that, according to calculations by Todos pela Educação, there will be a reduction of R$ 2,5 billion in the complementary resources of the Union. All these factors together lead to losses of almost BRL 20 billion, almost 8% of current resources.

According to the movement's technical note, the reduction in ICMS collection, generated by the PL that aims to reduce gasoline and electricity, may generate severe difficulties in honoring the payment of professionals working in Education planned for this year. Works in schools and educational contracts that underwent price adjustments to reflect cost inflation may also be impacted.

Understand how the processing of a Bill works

A bill can be presented by any deputy or senator, president of the republic and even by citizens. These begin to be processed in the Chamber, except for those that are presented by senators, which begin in the Senate, which works as a reviewing House for projects initiated in the Chamber and vice versa.

Soon after, the projects are distributed to the committees according to the subjects they deal with. There is a special commission, conclusive analysis in commissions and an urgency commission.

Ordinary law projects are approved with a large number of votes provided that a large number of deputies are present in the plenary. Soon after, it is sanctioned or vetoed by the President of the Republic.